Lord Lipsey, a labour peer, warns that middle-class pensioners will lose out
under the government's flagship care scheme

Thousands of middle-class pensioners could be forced to sell their homes to pay for their care or run down their life savings after ministers rejected calls to give them more support.

Last year the government said it was prepared to consider relaxing a means test for access to its flagship care scheme after it was accused of "betraying" middle-class pensioners with modest assets.

The scheme, which was launched in July last year, was intended to be "universal" and prevent anyone from having to sell their property while they are still alive to pay for care, either residential or in a care home.

The costs will instead be deferred until after an individual's death, when local authorities can recoup the money from the sale of their home.

But draft legislation, published last month, reveals that elderly people will not qualify for the scheme until they have run down their savings and other assets – such as valuables – to below £23,250.

Ministers have rejected calls to raise the threshold to £118,000, leading to accusations that middle-class pensioners are being unfairly penalised.

Lord Lipsey, a Labour peer and former member of the Royal Commission on long-term care of the elderly, accused ministers of misleading the public.

He said: "Thousands of people will have no real choice but to sell their homes to pay for care. Mostly these will be people of modest wealth who have worked hard and saved hard all their lives.

"In order to take advantage of the deferred payment scheme people would have first to run down their non-housing savings to a mere £23,250, then apply to the local authority for a deferred payment.

"People of modest wealth would be ill-advised to do any such thing which would leave them with slim financial resources to pay for the little luxuries that make their life bearable and provide for contingencies.

"In practice, the government’s scheme is not going to be a universal scheme. It is a scheme confined to the worse off, and will mean that middle class people are given no help at all to keep their homes. The take-up is likely to be low or negligible."

In July last year Norman Lamb, the care minister, launched a government consultation paper which promised a "universal scheme" which would bring "reassurance to millions of people.

However, the fine print of the government's plans showed that thousands of elderly people with modest assets would not qualify until they had savings and assets, excluding their homes, worth less than £23,250.

After a furious backlash Lord Howe, the health minister said "we are happy to consider using a threshold of £118,000 as we analyse consultation responses".

However in July the government published draft legislation stating that the £23,250 threshold will remain. The legislation is being consulted on at the moment, and is likely to be subject to a parliamentary vote before the General Election. Lord Lipsey said: "There is every chance of a revolt in one of both of the houses."

Government sources said that the decision not to raise the threshold had been "tricky", but said that it would have required a cut in the weekly funding that those on the scheme enjoy after going into care.

At present, pensioners on the deferred benefit scheme receive £150 a week in income for "life's little luxuries" beyond the cost of care. Ministers said this would have had to be cut by as much as two thirds to meet the cost of raising the threshold.

A Department for Health spokesman: “It’s wrong to say that the government committed to a higher means test. We have legislated so that the option of deferred payments for care will be available on the same terms everywhere in England, as the Dilnot commission recommended.

"This is designed to protect people that face losing their home because they have limited other means to pay for care.

"These are difficult decisions but they will make the social care system stronger and fairer. Introducing a care cap will protect people from catastrophic costs and deferred payments will mean no one should be forced to sell their home in their lifetime to pay for the care they need."